Partnership Firm Compliance in Pune — From ₹4,999

• Section 194T applicability review, all partners
• TAN application, if needed
• Partnership deed remuneration clause review
• ×Quarterly TDS returns including 194T
• ×Form 16A issuance to partners
• ×Section 40(b) computation and 26AS reconciliation
• ×ITR-5 filing
• ×Prior-year 194T remediation

• Everything in Growth — ₹44,999 a year
• Monthly bookkeeping
• GST returns
• Prior-year 194T remediation
• Section 40(b) computation and 26AS reconciliation
• Named dedicated CA

What Section 194T requires

Introduced by the Finance (No. 2) Act, 2024 and effective 1 April 2025, every firm and LLP must deduct TDS at 10 per cent on salary, remuneration, commission, bonus or interest paid or credited to a partner, once the aggregate to that partner exceeds ₹20,000 in a financial year. Under the Income-tax Act, 2025 it maps to Section 393(3), Table Sl. No. 7 from 1 April 2026 — same obligation, new numbering.

Credit counts, not just payment

Deduction is at the earlier of credit or payment, and crediting the partner's capital account is credit. A year-end book entry for remuneration triggers TDS even though no money moved.

The threshold is aggregate, per partner, per year

Interest of ₹15,000 plus commission of ₹10,000 to the same partner crosses it. And once crossed, TDS applies to the whole amount, not just the excess.

It is independent of Section 40(b)

You deduct on what is credited. Section 40(b) may disallow part of that in the firm's computation. So the partner's Form 26AS shows the full amount while only part is deductible for the firm. That reconciliation has to be planned into the entry, not fixed afterwards.

What non-compliance costs

Not deducting makes you an assessee-in-default under Section 201(1), with interest under Section 201(1A) on late deposit, ₹10,000 under Section 272BB for having no TAN, and ₹200 per day under Section 234E for a late TDS return. The expensive one is the 30 per cent disallowance of the expenditure under Section 40(a)(ia) — thirty per cent of partner remuneration added back to taxable income is usually a far bigger number than the TDS itself.

Section 40(b): what you can actually deduct

Revised from AY 2025-26: on the first ₹6,00,000 of book profit or in case of loss, ₹3,00,000 or 90 per cent of book profit whichever is higher; 60 per cent on the balance above ₹6,00,000. Interest on partner capital is capped at 12 per cent per annum simple. Two absolute conditions: remuneration is deductible only to a working partner, and only where authorised by the partnership deed. A deed that does not authorise remuneration, or does not quantify it or give a method to quantify it, results in the whole amount being disallowed. That is the single most common disallowance in firm assessments, and it is a drafting problem, not a tax problem. Remuneration for any period before the clause was introduced is also disallowed.

"Firm" includes an LLP

Under Section 2(23), all of this applies to LLPs too. Traditional partnership firms remain eligible for presumptive taxation. LLPs do not, and never did.

Which law applies this year

The return you are filing now, for FY 2025-26, is under the Income-tax Act, 1961. Income from 1 April 2026 falls under the Income-tax Act, 2025, where Sections 44AD, 44ADA and 44AE merge into Section 58 and Section 44AB becomes Section 63.

If you have not been deducting

Establish the position rather than wait for a notice — the exposure compounds and the disallowance lands in an assessment you did not plan for. We check whether ₹20,000 was crossed per partner for FY 2025-26, obtain a TAN if there is none, deposit the tax with interest under Section 201(1A), file the corrective TDS returns, issue Form 16A, and quantify the Section 40(a)(ia) disallowance so it is in your computation rather than discovered in scrutiny. Paying late is materially cheaper than being assessed.